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TMI Blog1982 (2) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... his order, the Tribunal held that the assessee can raise all the points before the ITO or in further proceedings in appeal against the assessment which may be made pursuant to the order under section 263. The ITO made a fresh assessment under section 143(3) read with section 263 of the Act. In this order he held that the concession envisaged in the Fifth Schedule of the Act or any other provisions of the Act has to be strictly construed. He held that the assessee is not entitled for higher development rebate. He also held that the assessee is not entitled for initial depreciation. He disallowed the claim of the assessee. In appeal, the Commissioner (Appeals) held that the assessee is within the scope of item No. 2 of the Fifth Schedule and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er development rebate and initial depreciation. He also submitted that the assessee falls under item No. (21) of the Fifth Schedule as the assessee's production to the extent of 70 per cent is seamless tube which falls within the scope of the Fifth Schedule. He placed reliance on various decisions referred to in the order of the Commissioner (Appeals). 3. We have considered the rival submissions. The assessee claims that it falls under item No. 2 of the Fifth Schedule which reads as under : " Aluminium, copper, lead and zinc (metals). " This is for claiming higher development rebate. The assessee also claims that for allowance of initial depreciation, it falls under item No. 2 of the Ninth Schedule which reads as under : " Non-ferro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... teel' as anything different from metal. By the addition of the word 'metal' in the Fifth Schedule to the Act, we do not think that anything more or less is meant than using the expression 'iron and steel'. The word 'metal' has perhaps been added to clarify that the commodity produced or manufactured must be still 'iron and steel' and that it should not have lost the characteristics of iron and steel. If iron and steel bars or other raw material has been used for making an article, which is known and accepted in common parlance or in the commercial world as a specific article different from iron and steel and that article can no more be treated or understood basically as iron and steel, that article cannot be termed 'iron and steel (metal)'. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition of the word metal' after the term 'iron and steel' in Schedule V would make any difference. The real distinction is what has been pointed out by the Supreme Court and which has been noticed by the Calcutta High Court in the passage which we have extracted above and that is, whether, by the process of change resulting from the manufacturing process, an article different from iron and steel had come into existence or not. The Kerala High Court has referred to this aspect and has held that by producing M.S. rods from iron and steel in a raw material form, the iron does not cease to be iron and steel does not cease to be steel and naturally they continue in metal form. The word 'metal' is used to emphasise that the change should not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Schedule. Applying the ratio laid down in the above cases, we hold that the assessee falls within item No. 2 of the Ninth Schedule and is entitled for initial depreciation. In view of the majority decisions referred to above which are in favour of the assessee, we are unable to follow the decision of the Calcutta High Court in Indian Steel Wire Products Ltd.'s case. Since we have held that the assessee falls under item No. 2 of the Fifth Schedule and item No. 2 of the Ninth Schedule and is entitled for higher development rebate and initial depreciation, it is unnecessary to consider ground Nos. 4 and 5 raised by the revenue. In the circumstances, we are not considering the other grounds raised in the appeal. Thus, we uphold the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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